What is rent control?
What do economists think of rent control?
In a 2012 IGM Forum – a survey of a panel of economists conducted by University of Chicago’s Booth School of Business – 52% of respondents strongly disagreed with the following statement: “Local ordinances that limit rent increases for some rental housing units, such as in New York and San Francisco, have had a positive impact over the past three decades on the amount and quality of broadly affordable rental housing in cities that have used them.” Moreover, 43% disagreed with the statement. In fact, just 1% agreed or strongly agreed. The panel includes a wide range of economists, including across the ideological spectrum. In general, rent control is one of the few policies whereby economists, regardless of ideology, agree; it doesn’t yield the outcomes it seeks.
What is the solution to housing unaffordability for a region?
The only long-term, sustainable solution of housing unaffordability is to correct the supply and demand mismatch. This typically means encouraging the development of new housing supply. If the solution isn’t correcting the supply-demand mismatch, then it will only be a short-term fix and could make the problem much worse.